DTI seeks views on software and business method patents

Ministers say they have initiated the debate in recognition of the impact of e-commerce and the internet in transforming the UK economy. The UK software and computer services market is the second largest in Europe, worth £21 billion. There are over 105,000 companies operating in this sector in the UK.

European patents are restricted to the protection of technical inventions. Present UK law (the Patents Act of 1977) and the European Patent Convention (1973) exclude computer software as such (unless it has what is known as a technical effect) and methods of doing business as such from patent protection. Following decisions in the Supreme Court, the US practice has moved towards granting patents for software and non-technical business methods. The divergence of practice has triggered the debate over the current European regime.

The controversy over patents for software and business methods is that, while some consider that such patents tend to stimulate innovation by providing adequate protection of the substantial amounts of money and resources that can be required to develop sophisticated and specific software, others believe that patents will on the contrary stifle fair competition and hinder innovation.

Mrs Hewitt said:

"We are seeking input on the potential impact of patents on innovation and growth, as well as feedback on the system in the US, where software and e-commerce patents are already available. These issues could profoundly affect the environment in which we do business. We need comments from all those who will be affected including those in the service, financial and business sectors who may never have come across patents before."

Dr Howells said:

"Until now companies have been able to develop computer software and business methods often without patents: this might change across Europe. We must make sure that those most likely to be affected know what the possibilities are and have the chance to make their views known."